Statkraft AS: Result for the second quarter of 2015

(Oslo, 23 July 2015) In the second quarter of 2015, Statkraft achieved an underlying[1] operating profit before depreciation (EBITDA) of NOK 2633 million, an increase of NOK 105 million compared with the corresponding period in 2014. The quarterly net profit is negative due to impairments and currency effects.

Average Nordic power prices were 20.7 EUR/MW which is 19 per cent lower than in the corresponding period last year. Lower prices were counterbalanced by higher power production, increased contributions from market operations in the Nordics and international hydropower.

"Given the market development the underlying operating profit is solid, but lower forward power prices have resulted in impairments," says President and CEO Christian Rynning-Tønnesen.

The net profit was NOK -2042 million, a decrease of NOK 2080 million compared with the second quarter of 2014. The decline was due to impairments triggered by lower long term price forecasts and negative currency effects. Statkraft recorded impairments of NOK 1820 million on wind assets in Sweden and NOK 384 million on hydro assets in India. Currency effects constitute NOK -2040 million in the financial items. Currency effects are largely counterbalanced by currency translation effects in equity.

Statkraft decided to upgrade Øvre Røssåga power plant in Northern Norway. This is the final part of a full modernisation of the Røssåga power plant system with a total investment of NOK 2.2 billion.

The Board of Directors decided in June not to invest in the planned Fosen and Snillfjord onshore wind power project in Norway due to lack of profitability. Statkraft and its partners have started a new study for an alternative plan for developing onshore wind power in the same area. The outcome of the study will provide a basis for assessing whether it is possible to obtain profitability.

Statkraft's position in Turkey was strengthened by the completion of the 102 MW hydropower plant Kargi in the second quarter. The purchase of shares in the Brazilian company Desenvix Energias Renováveis S.A. was completed 13th July. Statkraft's new ownership share is 81.3%. Desenwix develops hydropower and wind power and has an installed capacity of 316 MW.

Statkraft is a leading company in hydropower internationally and Europe's largest generator of renewable energy. The Group produces hydropower, wind power, gas-fired power and district heating and is a global player in energy market operations. Statkraft has 4200 employees in more than 20 countries.